How IO is building modular data centers for the rest of us

IO Data Centers wants to make it faster, cheaper and easier for companies to add computing capacity. The Phoenix, Ariz.-based company has made a large-scale shift from selling traditional data center capacity to selling its own brand of modular data centers that can sit just about anywhere, and that can be filled with servers one rack at a time. The units, called IO.Anywhere modules, are designed for smaller-scale deployments and those requiring less customization than the modular units filling up eBay’s cutting-edge data center just a few miles to the west of IO’s headquarters, but the idea is the same.

The problem, IO Co-Founder and CEO George Slessman told me during a recent visit, is primarily one of planning. This is especially true for traditional IT departments that try to plan ahead to determine what they’ll need as far as 10 years down the road. That’s a laudable goal, but “you’re gonna be wrong,” he said.

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Money spent on nothing

If companies realized they didn’t build enough capacity — something Slessman noted can happen even while a data center is still being planned and built — they’re going to pay. While the the gear that fills them drops in price with each new generation, data center prices “have been going up since the pyramids,” Slessman said. That’s not to mention the cost of energy to power them, which itself is always rising in terms of both kilowatt-hours and total capacity.

George Slessman

More often, though, Slessman said, “The real issue is the wasted resources that sit in most data centers.” Estimates vary as to how underutilized the average data center is (Slessman says most are operating at about 30 percent capacity, although some estimates put that number lower), but the end result is always far too high a price tag per megawatt actually used. Fifteen million per megawatt to build a traditional data center effectively turns into $45 million per megawatt if you’re only using a third of that capacity.

Data centers are also inflexible or, as Slessman likes to say, “thickly provisioned.” What he means is that it’s extremely difficult, if not impossible, to build a data center that adapts to changes either internally or in the greater IT world. While servers continually get more powerful and racks more dense, the amount of power available to each rack doesn’t change. And although some applications might vary in importance or new applications might come online, they all get the same resiliency. A Tier 4 data center is always a Tier 4 data center.

IO isn’t for webscale

Off the bat, you can see the differences between what IO is trying to do with its modules and what webscale operators such as eBay demand from theirs. Unlike the units from Dell (s dell) and HP (s hpq), which are really just lots of efficient compute power, IO’s modules are fully contained data centers including their own power supplies and cooling systems. They can handle only 250 kilowatts apiece (as opposed to eBay’s (s ebay) 800-kilowatt Dell module) and sport a very respectable, but not world-beating, Power Usage Effectiveness rating of 1.17.

Inside an IO.Anywhere module

But that’s plenty good enough for most of IO’s more-mainstream module customers, which aren’t aiming to run one of the web’s largest search engines. They don’t need to buy a module packed to capacity with servers (in fact, the 500-square-foot modules are roomy even when filled to capacity with 18 racks), but want something that can be sited wherever there’s room and that can be filled with gear as demand requires. They also like that IO.Anywhere units are capable of meeting Tier 4 resiliency requirements (that is, they’re designed to maintain a very high level of availability) but a single space can also house additional IO modules running at lower resiliency for less-critical applications.

Since shipping its first container in July 2011, Slessman said demand is ramping up nicely, especially among large enterprises. While about 75 percent of IO’s customer presently host their capacity at IO data centers, he expects that number to drop to 50 percent by the year’s end as more companies buy IO.Anywhere containers to put on their own premises. Business is doing so well, in fact, that IO built its own factory dedicated to constructing the modules with assembly-line-like efficiency.

Practice what you preach

Oh, and IO isn’t just the IO.Anywhere vendor, it’s also a client. About two-thirds of the company’s 538,000 square square feet of compute area in Phoenix is dedicated to modular data centers (the third is a traditional data center), and it has an entirely modular, 831,000-square-foot data center in New Jersey that recently achieved Tier 3 certification.

Just like it preaches for clients, IO only brings in new modules when it needs to. In Phoenix, it has space for 90 modules in its operational modular data center, which it calls Phase 2, but only has 33 in place. There’s additional space labeled Phase 3 that’s still sitting empty and unpowered; no use lighting or cooling something that’s not being used.

Compared with traditional data centers, IO’s modular data centers are striking in their minimalism. There are no cooling ducts and power supplies coming down from the ceiling, just open air. Standing on the three-foot-high raised floor, your eyes rarely focus above nine and a half feet, which is as high as the steely units rise. Because the modules contain their own cooling, the air in the modular data center space is markedly warmer than in the neighboring traditional space full of servers in cages.

However, the strongest evidence of IO’s commitment to efficiency might be its quest to, as Slessman told me, “actually reduce the amount of data center resources our customer have to buy.” It’s doing this by selling data center management software called IO.OS that lets customers monitor, analyze and control all their data center resources from a single interface. The software, he said, will drive hardware optimization by letting data center staff see what’s running, at what capacity, drawing how much power — you name it — and manage it all from the same screen (even if that’s on a tablet or smartphone).

Even if they’re not building scale-out cloud data centers, companies still will demand the level of automation and efficiency that cloud computing promises, and that’s only possible by complementing lower-power hardware with software-based intelligence. “And as we skate toward the cloud world,” Slessman said, “it’s all going to happen programmatically.”